Monthly Archives: August 2015

Darryl is a med device product manager in a tough spot. He’s supposed to establish a new direct-to-consumer channel to sell his product, after years of only selling through distributors. It’s a huge shift.

Darryl’s smart. He knows what he needs to be successful. And he knows he doesn’t have the customer insights necessary to develop the best strategy, nail the value prop, and get the messaging right. He wants to do customer research to fill the knowledge gaps. But he keeps getting pushback… he’s being told that the company knows these customers so there’s no need to do more research. The reality is the company does know the customers, but in a very different context. They know them as end-users, NOT as shoppers or buyers. It’s a totally different ballgame going direct. There’s a lot riding on getting it right. Darryl doesn’t want to blow it.

So how does Darryl break through the resistance? Here’s one very powerful approach that’s proven to be very effective, time and time again.

First let the “resistors” know that they may be right, maybe there is enough known about the customers. This puts Darryl and his colleagues on the same side, which helps disarm resistance.

Set up a team workshop to review all that’s known about the customers. Convey that since effective decision-making requires distinguishing facts from assumptions or beliefs, you want everyone’s input in order to efficiently compile as much useful information as possible. And if there happen to be any information gaps, that will emerge as well.

In the workshop, we would use our simple and powerful workshop activity we call Think vs. Know (more here) to help Darryl further disarm resistance, set egos aside (we actually bring a box marked “Put Egos Here”), and accomplish what he needs – which is to determine what is known, what is assumed or unexamined, and what the mission-critical information gaps are (if any).

To get the most from the Think vs. Know activity, it’s important to come up with 3 or 4 categories, for example, what do we think vs. know about the customer experience of buying through intermediaries, about their desire for something better, about their willingness to pay, or about their feelings toward your brand.

Wrap up by acknowledging all that is known and where there are mission-critical assumptions, and then together decide which assumptions are too risky to not validate. Now you have co-created together with the resistors a solid case for doing the customer research you really need.

Caution: While you can certainly use this approach on your own, sometimes you need experts to come in and manage the complex dynamics, hold people accountable, and facilitate good decision-making. It all depends on the level of trust, strength of relationship, and the type of culture. When we’re brought in as a professional consulting firm, we’re usually engaged to do the Think vs. Know piece, then conduct the needed research, then come back to the group to help them correct mistaken assumptions and move forward most effectively.

The 3Es behavior change framework offers a fresh approach to solving the problem of low enrollment in valuable health programs. Education, Engineering, and Enforcement are the components of the 3E framework, which traditionally has been used in the Injury Prevention field (CDC is a leader here). It’s time for others to harness its power as well.

A simple example: If we want people to drive slower, we can convince them why (education), we can add speed bumps (engineering), and we can ticket them (enforcement).

Another example: If we want people to quit smoking, we can convince them why (education), we can establish no-smoking zones everywhere (engineering), and we can fine them for lighting up in public (enforcement).

A third example: If we want people to participate in our Wellness program, we can convince them why (education), we can integrate Wellness into other membership activities they have to do with us (engineering), and we can charge higher rates to non-participants (enforcement).

OK, the last example may be a bit oversimplified, but you get the point. Now let’s dig deeper. Seven key takeaways:

1. Health Behavior Change is Hard

Doctors, insurers, and public health agencies all want people to adopt specific behaviors that will help those people be healthier. It may be taking meds as prescribed, losing weight, avoiding injuries, or a host of other behaviors that ostensibly benefit the individual, the organization, and society at large.

But sometimes the target behavior is simply getting people to check out a program that can help them, like CMS’s Health Insurance Marketplace. Or insurers getting their members to sign up for free Wellness programs. Typically, participation is disappointingly low. Program developers, marketers, and outreach specialists that create and run these programs are astounded by the number of people that don’t sign up for their offerings.

What’s going on??

2. Compare Company/Customer Perspectives

Insurance company: Our Wellness program is designed to help our members. It can improve their health and save them money. And it’s free. All people need to do is go on our website and enroll. Why aren’t people signing up like crazy?

Customer: Why would I do a Wellness program with my insurance company? They’re number crunchers, they don’t know about wellness and prevention. Anyway, it’s probably just a way for them to cut my benefits and make more money.

These contrasting perspectives indicate a serious relationship problem. As an industry, health insurance companies rank among the lowest in customer satisfaction in 2014, according to the American Customer Satisfaction Index (about the same as airlines, the US Post Office, and cell phone providers – but better than cable companies!). If satisfaction is low, trust is likely to be low too. This means insurers start pitching their Wellness program with a credibility deficit.

3. Don’t Make Assumptions

Insurers and others presume that members should value their Wellness programs. This is mistake #1, and for a couple reasons.

First, members need to know about the program in order to decide if they will enroll in it or not. You telling them about the program does not mean they know about it. All it means is you provided them with some materials.

Second, for members to care about your Wellness programs requires them to: a) understand what Wellness is, b) value Wellness, c) want to enhance their Wellness now, d) want help in doing it, and e) want that help from their health insurance company.

Figure out what your Value Proposition is: Determine exactly what makes your Wellness Program unique and valuable to members. And from their point of view of course.

4. Go Beyond Convincing (aka “Education”)

It’s one thing to get members to take time and seriously think about your Wellness programs, commit to trying them, signing up, etc. And a small segment of members (the “low hanging fruit,” so to speak) will do just this. All they need is the opportunity.

Consider your own life. Let’s say you own a Toyota and your local dealer was offering a “Car Wellness” program with all kinds of helpful information so you can take better care of your car. To take advantage of their free program designed just for Toyota owners, simply go to their website, enroll, choose classes, attend, etc. You want your car to be in good shape and last many years. Would you do it? (I’m not talking to the car buffs here!). If not, why not?

There are a lot of answers to why not. Most people will say time and money, but that’s far from the whole story. We spend on what we care about. And we don’t always think through things and make rational decisions.

That’s you’ll need to go beyond the traditional and assumption-filled Education strategy, and bring in Engineering and maybe even Enforcement.

5. Be Like Vegas – Embrace “Engineering!”

In Vegas, slot machines are ubiquitous – they’re in bathrooms, by airport gates, everywhere. The environment is engineered to entice people to play. In fact, people need to go out of their way to not gamble.

Because Engineering changes the environment or product, it doesn’t require people to make any choices. The behavior just automatically happens (like slowing down over speed bumps or signing up for a default Wellness program as part of overall enrollment). Evidence suggest that this passive or automatic approach is usually more effective than those that require more active decision-making.

The key Engineering question is this: How can you make participation automatic? How can you make it so it’s easier for members to participate with your Wellness content than it is to not participate? Really think about this. List your assumptions, which can then be validated or corrected.

To start, understand the member experience, so you can identify the best Wellness touch points from a timing point of view. For example, maybe when people newly enroll as members they are so inundated with information, that Wellness Programs are the last thing on their minds. But when they get their surprise hand-signed Welcome card from you (right?) a few weeks later, they may be very receptive. What are the best touchpoints for engaging members in Wellness?

Consider bundling the process of enrolling in Wellness Programs with other sign-ups. But don’t just focus on getting them to enroll. Focus on getting them engaged. Here are some suggestions to think about Engineering from the perspective of marketing content: Consider small tidbits of Wellness tips that can be included in every single interaction with members. Think about integrating invitations for your Wellness program at times when people may find them more relevant. Put heart health tips on EOBS for cardiology visits, add smoking cessation tools on rate cards that show the differential for smokers, put cold and flu prevention tips on Back to School pieces. In short, meet people where they’re at.

6. Make Them Participate: Enforcement

Enforcement is the “hammer” strategy (or “carrot” if designed well). If members don’t enroll or participate in your Wellness programs, it’s gonna cost them. Could be on the front end, could be on the back end. This approach requires policies or regulations that you then enforce.

Enforcement means you have clear boundaries, expectations ,and consequences. Most people don’t love enforcement, but at the right time and place, and in combination with Education and Engineering, it is a strong motivator of compliance and behavior change.

We know several medium and large med device companies that still claim, “we sell boxes.” They may not say exactly that to customers, but inside the company they use those words, and usually with a mixture of pride, arrogance, and I think fear. Unfortunately, that thinking insidiously infiltrates everything the company does, from new product innovation to downstream marketing.

But that’s how some med device execs, engineers, and product managers think about the business they’re in: Making and selling “boxes” with good medical technology inside. It’s an easy trap to slip into – especially if the company has had success. The reality is med device companies do make boxes. However, that’s not the business they’re in.

Every med device company is in the business of improving healthcare and saving lives. Solutions to meaningful problems is what they sell.

In 1960, Harvard Business School professor Theodore Levitt wrote a game-changing article called Marketing Myopia. He posited that businesses do better when they focus on meeting customers’ needs rather than on selling products.

His quintessential example of an industry that got it wrong was railroads. While the need for freight and passenger transportation grew, railroads shrank. They wrongly thought they were in the railroad business. They didn’t see they were really in the transportation business. Why? Because they were product-oriented, not customer-oriented. As a result, railroad companies let others take their customers away.

Though it was over 50 years ago that Levitt wrote about marketing myopia, I believe that product-centric thinking still dominates in healthcare. What do you think?

Med device and other life science companies often engage us to help them improve their marketing and make more money. One simple and revealing “litmus test” question we ask at the get-go is this:

Why should customers choose your product? (10 words or less!)

Often company execs, product managers, and marcom folks struggle to provide a clear, compelling, and jargon-free answer. Why? They naturally get caught up in their products and in doing what needs to get done. As a result, they lose sight of the “why” from a customer point of view.

The antidote is putting the customer first in all you do, and building that into how you operate day-in and day-out. It’s not easy, and takes long-term commitment, even when money is tight.

One step in a customer-first direction is challenging your team to create a set of answers to why customer should choose you. Keep them short, 10 words or less. Then test them with customers. Compare them to what competitors say and could say. Keep iterating until the answer is both persuasive logically and emotionally with customers.

Do this for every product and service you offer. Build it into your R&D process at the earliest stages. You’re on your way to a set of cohesive, distinctive and effective value propositions that can make all the difference in your marketing success.

Start now with your top of mind answer: Why should customers choose your product?

Over the years, many med device companies have pursued a “whole house” strategy in order to increase sales within their hospital install base. We’ve seen the approach fail more fail more often than not because it usually comes across as all about the manufacturer, not about what’s best for the customer.

What device companies essentially say: Buy everything for a care area (say the ICU) from us, and you’ll have maximum interconnectivity that will improve work flow and patient care. And you’ll reduce demand on the your IT department. And by dealing with only one vendor, Purchasing will save time and money.

What hospitals hear: You’re purposely designing your devices to not “talk” to competitor products in order to lock them out. How does that help us? It feels like you’re manipulating us into buying everything for our ICU from you. We’d rather buy “best of breed” and work with companies that enable connectivity with other brands.

And therein lies the golden opportunity: Flip it.

What if instead, you told hospital customers that you recognize they can’t buy everything for their ICU from you, and they probably shouldn’t. In fact, you purposely designed your devices to work well with competitor products.

Note how much more customer-centric this presentation is. And it still lets you offer meaningful clinical and financial advantages from buying multiple devices from you, without triggering perceptions that you’re being manipulative and greedy. Because you’re not.

Let’s say you need to come up with new products and services that will make a lot of money. Here are 3 customer-centric principles that help you do first things first in new product innovation, and get far better results. We call them our “B4” principles (as in what comes “before” what).

Purpose B4 Profit: Your company exists to achieve a certain purpose (what Simon Sinek calls your “why”). Be clear and passionate about your purpose. And know that turning a profit is not it. Successfully fulfilling your purpose is how you make money; it will always entail satisfying desires of your customers. Which requires…

Customer B4 Product: It all starts with the customer. The notion of putting customer desirability ahead of technical feasibility is a hallmark of Human-Centered Design. Avoid the seduction of making things because you can, rather than because customers value what it does for them and will pay for it. This means…

Problem B4 Solution: First focus on identifying meaningful problems and unmet needs that customers care about before diving into technology and solutions. Even if you initially come up with a great idea of a new product, think through the lens of how it will improve the customers’ situation.